In a fiat monetary system in which exponentially rising debt is a feature, not a bug, borrowers are always going to need relief in the form of lower interest rates. So much for “higher for longer”. Central banks are being a bit stubborn right now, but it won’t last.
That left the benchmark prime rate stuck at 4.95 per cent, more than a percentage point above its 20-year average of 3.87 per cent.
Since lower rates tend to inflate home prices, many bargain-hunting homebuyers were high-fiving the rate freeze. Most floating-rate borrowers and real estate stakeholders, however, were left groaning.
We had a central banker who drop rates to near zero for much too long, and replaced it with a central banker who waited too long to raise rates, and then is taking too long to lower them.
All at the behest of the biggest borrower of all, the government of Canada
High or low, interest rates don’t just affect the housing market.
If your economy is so shitty that you can only consider housing, then stick a fork in it cuz its over.
Whatever happened in the past is in the rearview mirror. Going forward we are heading into choppy waters. Housing prices are high, interest rates are high for the size of the mortgages (i.e. the monthly payment), inflation is high, taxes are high, government debt is high, government borrowing is high, economic growth is slow and wage increases are low.
A couple things bug me about this fascinating Tucker podcast with Max Bernier. The biggest being that Max didn’t know whose idea it was to sell off Canada’s gold reserves. It’s was Carney.
https://tuckercarlson.com/tucker-show-maxime-bernier
You mean, whose idea it was to sell off Canada’s REMAINING gold reserves.
In the ’60s, Canada had more than 1,000 tons of gold. But our governments began sneakily selling it off, until by 2005, we were down to less than 4 tons.
https://www.fliegerfaust.com/historical-peak-of-canadas-gold-reserves/
I wouldn’t mind so much if we spent the money on building up fuel and ammunition reserves.
In1980 they decided to shrink the “money supply” and rates soared to 24%!!
That worked. Broke “inflation”, the stated goal. Bankers asked for more security to back our loans and stopped lending to countries buying our grain.
Displaced many from their homes and farms.
Canada needs a Cromwell. That is who Trump is: America’s Oliver Cromwell.
And if he fails using the ballot, well, MAGA will move to the next strategy. But MAGA is here to stay and a National Divorce in the US is inevitable. Hey, no country is eternal.